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Project Entrepreneurship. Submitted to Sir Zahid Bangash. Submitted by Sohail Ur Rehman Sher Mohammad
Email: pak.maw@yahoomail.com
Nature of business: Automobile Statement of financing needed: All the financial needs and initial capital will be invested form the owner side. And after two or three years when business will expend than it could be possible that we can finance by bank. Or it could be possible that we make our business into partnership by sole-proprietorship. Executive Summary
PAK Mobile Auto Workshop (PMAW) is a start-up organization that offers a complete car repair service as well as a full-featured retail parts store. PMAW will serve car repair service within a city with a mobile van. We will provide services at your door step. Including provide the spare parts and installment service for the people of Islamabad for domestic peoples and industrial persons. The auto repair market has a lot of competition; however, almost all only offer service. PMAW will differentiate themselves by not only offering a mobile repair service, but a fully stocked parts store. PMAW will attract and maintain a loyal customer base through their customer-oriented focus on business. All employees are trained and held responsible for providing superior service, developing a long lasting trust bond with customers. This is very important, especially in the auto
The economic growth of the last several years has resulted in increased disposable income. Many people have chosen to spend part of their increased income to having a car and the trend of automobile company increases. As a result, the need for reliable and convenient auto services has substantially risen as well. PMAW will position itself to capitalize on the growing need of the middle and upper class market for quality auto service in the area. The company will be privately owned and run the business. The number of repair workshops is increase day to day but there is no trend of mobile workshop and the ratio of car fault or defective of any part is increases because the spare parts not met in the market same as original and the other parts are not too much reliable so this is positive fact for our business that we could sell our spare part business.
1.2
Analysis of competitors:
PMAW faces over 100 large and small auto repairs and auto parts competitors in the local area. Only a quarter of these competitors offer both auto repair services and auto parts inventories. Among these, only a few are major national chains. The remainder is small privately-owned establishments. PMAW will compete well by focusing on convenience and offering a high level of customer service. Additionally, its honest reputation will be a major factor in repeat business and building a large base of regular, loyal customers.
Chaudry son Automobile Workshop Near Post office melody, Islamabad Islamabad +92-51-5710297
1.2
Market segmentation:
Between having a high level of commute traffic, and an equally high level of traffic on local highways, there is a constant significant demand for auto repair services and auto parts. So our market segmentation is local residence customers or industries within a city and for most middle and upper class consumers and travelers. (2) 2.1 Description of venture Products offered: Product lines usually include: Tires. Batteries. New and remanufactured parts for domestic and imported cars, including: Suspension parts. Ignition parts. Exhaust systems. Engines and engine parts. Oil and air filters, belts, hoses, and air conditioning parts. Lighting. Wiper blades. Brake parts. Chemicals, including oil, antifreeze, polishes, additives, cleansers and paints. Mobile electronics, including sound systems, alarms, and remote vehicle starters. Car accessories, including seat covers, floor mats, and exterior accessories. Hand tools, including sockets, wrenches, ratchets, paint and body tools, jacks and lift equipment, automotive specialty tools and test gauges.
The size of the business will be small to medium because the business will initially starts with one mobile van and spare parts for a small inventory. The cost of the business estimated through initial capital show as under.
Start-up capital requirements Start-up Expenses Legal Shop maintenance Other 8,000 15,000 7,000
2.4
Office equipment: In our business there will be no concept of office, the shop will be treated as office. In the shop at the front side there will be small space for our office where the spare parts fixed for sale. We want consume very little amount on the office equipment at the startup of our business it include the
Personnel:
Table Chair Telephone set Stationary Book keeping registers Cupboard, shelves Store room
The company will seek two entry level mechanics to be hired within a few months after the company is operating. Accounting, bookkeeping, and marketing services will be done by our office boy (helper). The company's intermediate goal is to have four full time, fully trained mechanics at the original facility. However, we have decided to await future developments before determining the best time to bring on such personnel. The staff table and monthly payroll graph are as under; Monthly payrolls
2.5
Background of entrepreneur:
My uncle has 20 years of experience and skills in car repairing. And running own shop for a number of years. The proprietor directly run the business, because of direct influence in the operations of the business and has a capability to control and manage it in good manners. But they dont have knowledge of accounting and book keeping and marketing and how business is run in future forecasting techniques and they cant put their effort on management side. And all these week areas will cover from my side and my uncle will be the technical supervisor of our business and I will be the managing director of the business.
(3)
3.1
Production Plan Machinery and equipments: Automotive testing and tuning instruments Oil pressure tester Tool storage trolley A.C leak detector Automobile ac equipments and tools Wheel aligner Wheel balancer Break bleeding systems Engine analyzer
(4)
Operational Plan 4.1 Description of companys operation. Telephonic numbers: We need some contact numbers for a relationship with our customers. So there are many possible networks and numbers through which users can make a call for business dealings and relationship building. Here are some suggested numbers. +92-333-3039349 +92-300-9779818 +92-345-9501282-etc.
PMAW exists in a purely competitive environment where each firm must be a price taker. In other words, the firm has no ability to affect the market price of its services, regardless of how many automobiles it repairs What all of this means for PMAW is that the company must seek to charge its clients at the market price (or lower As long as marginal costs do not exceed revenues, the method to maximize short-run profits is to service automobiles at maximum capacity. 5.2 Promotion: Cable ads
5.3
Since the automotive repair industry is, operationally, in a job-shop environment, it is somewhat difficult to estimate sales. And each individual product or service is personalized or unique to that job, and is only initiated once an order is made and it also will be include the service charges. For the most part, sales for an automobile repair firm are steady year round and reflect little seasonality. The table and charts below outline the sales forecast. Three years of annual sales and costs of sales are shown.
6.1
Form of Ownership:
Owner will be the beneficial or entire profit and bear entire loss of the business. The startup capital and re-investment also bear by him. But on the other hand if there is need of capital to enhance the business unit from two or three places with the same setup than the legal form of business could be change to partnership business. The profit or loss would be divided as the percentage of their investment including the goodwill of the business. The other unit will be work under the head of this unit. The 70% capital will be invested by the existing proprietor. And more than 70% share does not transfer to the other single one. If it is not possible and difficult to find our partner than we can get a loan from bank or any other entity.
6.2
Authority of principals.
As we know there is sole proprietorship business so there will be centralized decision making and rules and regulations or principles will come through top of the management.
6.3
As I have mention in section (2.5) that my uncle has 20 years experience of repairing. He will be the supervisor of mechanics and will train to all other mechanics. On the management side I am fresh graduate however I have done number of projects and having good accounting knowledge and I have done also internship in the banks that will be helpful to creating strong relationship with the banks.
Our company all member should very careful about the companies positive reputation because there will be word of mouth promotion that will helpful creating sales. They should keep honesty and keep full attention on seeking and learning their work and do their task that has been assigned. (7) 7.1 Risks and Assumptions Evaluate weaknesses of business:
It could be possible misunderstanding between client and us. It is not possible that client could tell us the real problem in the car and our mechanic could not understand that what he saying on cell phone. Customer or youngster can fool for us, the can make a call and say us the address and problem but when our team will reached there, there will be no people and no car. 7.2 New technologies:
We now that the technology advancement is rapidly increases and in our business the machines that are automatic detect and analyze the faults are newly and newly came into the market like automatic testing and analyzer. 7.3 Contingency Plan:
A contingency plan is not a huge concern. We will further proceed whenever any problem and conflict will arise in our business. (8)Financial plan 8.1 Projected income statement:
1,107,000 73.80%
1,135,800 70.99%
1,201,700 68.67%
Expenses Payroll Sales and Marketing and Other Expenses Depreciation Utilities Rent Others Total Operating Expenses 891,000 908,000 925,000 636,000 30,000 5,000 120,000 100,000 638,000 28,000 7,000 125,000 110,000 640,000 25,000 10,000 130,000 120,000
216,000 17,280
227,800 18,224
276,700 22,136
Net Profit
198,720
209,576
254,564
8.2
Balance sheet:
Assets
Year 1
Year 2
Year 3
Current Assets Cash Inventory Other Current Assets Total Current Assets 34,532 360,250 50,000 444,782 431,646 425,545 50,000 907,191 1,382,575 502,675 50,000 1,935,251
Year 1
Year 2
Year 3
Current Liabilities Accounts Payable Current Borrowing Other Current Liabilities Subtotal Current Liabilities 30,000 0 0 30,000 32,000 0 0 32,000 40,000 0 0 40,000
100,000 130,000
110,000 142,000
120,000 160,000
Paid-in Capital Retained Earnings Earnings Total Capital Total Liabilities and Capital Net Worth
8.3
Break-even analysis:
40,000
Assumptions: Average Percent Variable Cost Estimated Monthly Fixed Cost 4% 38,900